Testimony resumes in Thomas Etheredge trial

WICHITA — In morning testimony of the securities fraud trial of Wild West World founder Thomas Etheredge, the defense counsel laid groundwork for why a relative trusted Etheredge enough to sell him 80 acres of land and invest $150,000 in the theme park.

It was the second day of testimony for Marvin Whitson, the uncle of Etheredge's wife, Cheryl. Whitson said he had a vested interest in wanting to see Wild West World succeed because he had a son who worked for the park.

At the time he sold Etheredge the land in 1999 for the Prairie Rose Chuckwagon Supper in Benton, Whitson knew that Etheredge had been in prison but didn't ask for a lot of details about why.

In response to questioning by one of the defense lawyers, Chris Joseph, Whitson said he decided to make loans to Etheredge because he considered him trustworthy.

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Joseph asked whether Whitson would not have invested in the park if he had known all he knew now about Etheredge's two prior felony convictions, including one for securities fraud in the mid-1980s.

"No, I can't say that," Whitson said.

The prosecution is trying to prove that investors wouldn't have given Etheredge money for the park — which stayed in business for only two months in 2007 before going bankrupt — if they had known about his past. Prosecutors also frequently point out that Etheredge did not repay more than $750,000 to investors after the fraud convictions of 25 years ago. Under the law at that time, he wasn't required to make restitution because he served four years in prison.

Rick Fleming, general counsel for the Kansas Securities Commissioner's Office, had questioned Whitson about those matters Tuesday.

In his follow-up questions today, Fleming said, "The question is not would have you changed your mind. The question is whether you would have invested $150,000 if you had known at that time about his criminal history and about the restitution."

"Again it would have been good information to know," Whitson said. "I would have asked more questions. It might have some input there.

"But I really don't think it would have (made a difference), but it's hard to comment now what I would have done 20 years ago."

Fleming asked, "If you were not related to him, would you feel differently?"

"I think I would have," Whitson said. "I would have investigated it more. It would have made a difference."

The prosecution also entered into evidence records of the First National Bank of Southern Kansas in Mount Hope, which was the lead bank in a consortium of banks that lent Etheredge about $6 million for Wild West World.

The morning also heard testimony from Sandy Ring, an official with the South Central Kansas Economic Development District. The group helps facilitate loans from the Small Business Administration.

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Under the terms of the initial SBA loan obtained by Etheredge, he could only use the money for such expenses as construction costs. But the prosecution has alleged that he also used the money to buy rides at the park, a move that caused the SBA to cut off future loans.